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Compound Annual Growth Rate Calculation

How do I calculate the future value of an investment with a 12% compounded return.

Hello, can you tell me if I invest x amount of money for period of 25 years which grows at the rate of 12% compounded annually - what formula/process should i apply to arrive at the maturity amount given that rate of inflation is 6%? Thanks for your help in advance!

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Bill's Answer
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You are asking about CAGR or compund annual growth rate. In your case, your gross return would compound at 12% and net return would compound at 6%.

Just solve for the future value.

http://en.wikipedia.org/wiki/Future_value

http://www.investopedia.com/terms/c/cagr.asp

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